2276. Segmentation of Marketing [Nokia]

8/6/2019 2276. Segmentation of Marketing [Nokia]

1/71

DISSERTATION REPORT

ON

SEGMANTATION IN MARKETING

(With reference to NOKIA CO. LTD )

Submitted for the Award ofBachelors of Business Administration (Finance)

( 2007 - 2010 )

SUBMITTED BY :

AMAN NARULA

Enrolment No. A3906407040

AMITY SCHOOL OF BUSINESSAMITY SCHOOL OF BUSINESS

AMITY UNIVERSITY, UTTAR PRADESH

1

8/6/2019 2276. Segmentation of Marketing [Nokia]

2/71

Acknowledgement

Completing the project work is never one-man effort. It is often the result of valuable

contributions of a number of individuals in a direct or indirect manner that helps in shaping

and achieving stated objectives. This project report bears the imprint of those who had

rendered their wholehearted support and encouragement without their help this effort of

mine would be in vain.

It is my privilege and great pleasure to thank all assiters who assist me to do my work

without their assistance this dissertation report not have been successful. I am indebted to

him for lending his precious time and co-operation towards the execution of this report.

I also consider it as a great honour to express my heartful gratitude to my faculty guide

for his kind support and guidance towards this dissertation report.

Last, but not least I would like to express my deep sense of gratitude and thanks to my

parents and friends for their support.

AMAN

NARULA

2

8/6/2019 2276. Segmentation of Marketing [Nokia]

3/71

Contents

Acknowledgement

Preface ii

1. Introduction

1 .1Introduction to Marketing 3

1 .2 Market Segmentation 10

1. 2.1 Considerations for Market Segmentation 13

1.2 .2 Segmentation Basis 161.2.3 Effective Segmentation 28

2. Introduction 29

2.1Reviw of Literature 30

2.2Objective of the study 30

2.3 Methodology 31

2.4Limitation of study 31

3.Introduction

3.1Nokia 323.2Nokia Vision/ Mission Statement 33

3.3About The Company 34

3.4SWOT Analysis 42

3.5Market Segmentation for Nokia 45

3.5.1Segmentation of Nokia 45

3.5.2Nokia mobile phones by Series 48

3.5.3Lifestyle and Psychographic Basis for Nokia 50

3.5.6The Segmentation of Nokia conducted on the basis of Price 50

4.Analysis and Interpretation 62

5.Conclusion 66

6.Recommendations 67

7.Bibliography 68

8.Annexure 69

3

8/6/2019 2276. Segmentation of Marketing [Nokia]

4/71

Introduction to Marketing

"Marketing is the process of planning and executing the conception, pricing, promotion,

and distribution of ideas, goods, services, organizations, and events to create and

maintain relationships that will satisfy individual and organizational objectives." The new

definition of marketing, as released by the American Marketing Association is:-

Marketing is an organizational function and a set of processes for creating,

communicating and delivering value to customers and for managing customer

relationships in ways that benefit the organization and its stakeholders.

"Marketing is a social and managerial process by which individuals and groups obtain

what they need and want through creating and exchanging products and value with

others." (Kotler & Armstrong 1987)

The Mission of marketing is satisfying customer needs. That takes place in a social

context. In developed societies marketing is needed in order to satisfy the needs of

society's members. Industry is the tool of society to produce products for the satisfaction

of needs.

Marketing is one of the most important functions in business. It is the discipline required

to understand customers' needs and the benefits they seek. Academics do not have one

commonly agreed upon definition. Even after a better part of a century the debate

continues. In a nutshell it consists of the social and managerial processes by which

products (goods or services) and value are exchanged in order to fulfill the needs and

wants of individuals or groups. Although many people seem to think that "Marketing"

and "Advertising" are synonymous, they are not. Advertising is simply one of the many

processes that together constitute Marketing.

4

8/6/2019 2276. Segmentation of Marketing [Nokia]

5/71

What is Marketing?

The term marketing has changed and evolved over a period of time, today marketing is

based around providing continual benefits to the customer, these benefits will be

provided and a transactional exchange will take place.

The Chartered Institute of Marketing define marketing as The management process

responsible for identifying , anticipating and satisfying customer requirements

profitability

If we look at this definition in more detail Marketing is a management responsibility and

should not be solely left to junior members of staff. Marketing requires co-ordination,

planning, implementation of campaigns and a competent manager(s) with the appropriate

skills to ensure success.

Marketing objectives, goals and targets have to be monitored and met, competitor

strategies analysed, anticipated and exceeded. Through effective use of market and

marketing research an organisation should be able to identify the needs and wants of the

customer and try to delivers benefits that will enhance or add to the customers lifestyle,

while at the same time ensuring that the satisfaction of these needs results in a healthy

turnover for the organisation.

Philip Kotler defines marketing as satisfying needs and wants through an exchange

process

Within this exchange transaction customers will only exchange what they value (money)

if they feel that their needs are being fully satisfied, clearly the greater the benefit

provided the higher transactional value an organisation can charge.

P.Tailor of www.learnmarketing.net suggests that 'Marketing is not about providing

products or services it is essentially about providing changing benefits to the changing

needs and demands of the customer.

5

8/6/2019 2276. Segmentation of Marketing [Nokia]

6/71

Advantages

Identifies needs and wants of consumers

Determines demand for product

Aids in design of products that fulfill consumers needs

Outlines measures for generating the cash for daily operation, to repay debts and

to turn a profit

Identifies competitors and analyzes your product's or firm's competitive advantage

Identifies new product areas

Identifies new and/or potential customers

Allows for test to see if strategies are giving the desired results

Disadvantages

Identifies weaknesses in your business skills

Leads to faulty marketing decisions based on improperly analyzed data

Creates unrealistic financial projections if information is interpreted incorrectly

Identifies weaknesses in your overall business plan

6

8/6/2019 2276. Segmentation of Marketing [Nokia]

7/71

Levels of Marketing

Strategic Marketing

Strategic Marketing attempts to determine how an organization competes against its

competition in a market place. In particular, it aims at generating a competitive advantage

relative to its competition.

Operational Marketing

Operational Marketing executes marketing functions to attract and keep customers and to

maximize the value derived from them, as well as to satisfy the customer with prompt

services and meeting the customer expectations. Operational Marketing includes the

determination of the marketing mix.

Functions of Marketing

Market research

Advertising and sales promotion

Public Relations

Selling

Servicing

Methods of payment and credit

7

8/6/2019 2276. Segmentation of Marketing [Nokia]

8/71

The Social Function of Marketing

In modern society production and consumption are apart from each other. Marketing

connects them. From the societal point of view, marketing is a philosophy, which shows

how to create effective production systems and consequently prosperity.

Business is a subsystem of society, which has both a social and an economic role. Thus, a

company must operate in a way that will make possible the production of benefits for

society and, at the same time, produce profits for the company itself. (Davis, K. et al.

1980) The role of marketing in society means also responsibilities. In addition to

economic and social responsibility, ecological responsibility is nowadays emphasized.

According to some definitions, environmental responsibility is part of social

responsibility. Improvement of marketing is related to the changing emphases of

economic, social and environmental responsibility. Goodpaster and Matthews (1982)

analyzed three patterns of thought, which can be distinguished for a company's social

responsibility: 1. The invisible hand; 2. The hand of government; and 3. The hand of

management.

1. The invisible hand view (promoted by e.g. Milton Friedman) concludes that the only

social responsibilities of business organizations are to make profits and to obey laws.

Free and competitive market-place will ensure the moral behaviour of companies. The

common good is best served when individuals and organizations pursue competitive

advantage.

2. The hand of government view (promoted by e.g. John Kenneth Galbraith) concludes

that companies are to pursue rational and purely economic objectives. It is the regulatoryhand of the law and political process which guides these objectives towards common

good.

8

8/6/2019 2276. Segmentation of Marketing [Nokia]

9/71

3. The hand of management view (presented by Goodpaster & Matthews) would put the

responsibility of a company's actions into the hands of the company itself. It is concluded

that the moral responsibilities of an individual may be projected into an organization, and

that the concepts of an individual's responsibility and a company's responsibility are

largely parallel. Therefore, organizations should be no less or no more responsible than

ordinary persons.

The Traditional and Integrated Functions of Marketing

Traditionally, marketing has been seen as a link between production and customer. The

situation could be captured better by using the term selling. Selling is associated to the

so- called "Production and Sales Eras of Marketing". Slogans: "Make what you can

make" and "Get rid of what you have made" describe the traditional view of

marketing/selling.

The following figure shows the role of traditionally oriented marketing in (traditionally

oriented) management.

Marketing was born out of a need to take better into consideration the demand factors in

production planning. The function of marketing is to channel information of consumer

needs to the production and satisfaction of needs to consumers. The basic power of

marketing is the aspiration to produce and sell only that kind of products which have

demand. Marketing integrates the whole company to serve this demand. Marketing aims

at effective production systems, where information is transmitted effectively between

production and consumption.

9

8/6/2019 2276. Segmentation of Marketing [Nokia]

10/71

10

8/6/2019 2276. Segmentation of Marketing [Nokia]

11/71

Market Segmentation

Market segmentation is one of two general approaches to marketing; the other is mass-

marketing. In the mass-marketing approach, businesses look at the total market as though

all of its parts were the same and market accordingly. In the market-segmentation

approach, the total market is viewed as being made up of several smaller segments, each

different from the other. This approach enables businesses to identify one or more

appealing segments to which they can profitably target their products and marketing

efforts.

The Market-Segmentation process involves multiple steps. The first is to define the

market in terms of the product's end users and their needs. The second is to divide themarket into groups on the basis of their characteristics and buying behaviors.

Possible bases for dividing a total market are different for consumer markets than for

industrial markets. The most common elements used to separate consumer markets are

demographic factors, characteristics, geographic location, and perceived product benefits.

Demographic Segmentation involves dividing the market on the basis of statistical

differences in personal characteristics, such as age, gender, race, income, life stage,occupation, and education level. Clothing manufacturers, for example, segment on the

basis of age groups such as teenagers, young adults, and mature adults. Jewelers use

gender to divide markets. Cosmetics and hair care companies may use race as a factor;

home builders, life stage; professional periodicals, occupation; and so on.

Psychographic Segmentation is based on traits, attitudes, interests, or lifestyles of

potential customer groups. Companies marketing new products, for instance, seek to

identify customer groups that are positively disposed to new ideas. Firms marketing

environmentally friendly products would single out segments with environmental

concerns. Some financial institutions attempt to isolate and tap into groups with a strong

interest in supporting their college, favorite sports team, or professional organization

through logged credit cards. Similarly, marketers of low-fat or low-calorie products try to

11

8/6/2019 2276. Segmentation of Marketing [Nokia]

12/71

identify and match their products with portions of the market that are health-or weight-

conscious.

Geographic Segmentation entails dividing the market on the basis of where people live.

Divisions may be in terms of neighborhoods, cities, counties, states, regions, or even

countries. Considerations related to geographic grouping may include the makeup of the

areas, that is, urban, suburban, or rural; size of the area; climate; or population. For

example, manufacturers of snow-removal equipment focus on identifying potential user

segments in areas of heavy snow accumulation. Because many retail chains are

dependent on high-volume traffic, they search for, and will only locate in, areas with a

certain number of people per square mile.

Product Benefit Segmentation is based on the perceived value or advantage consumers

receive from a good or service over alternatives. Thus, markets can be partitioned in

terms of the quality, performance, image, service, special features, or other benefits

prospective consumers seek. A wide spectrum of businessesfrom camera to

Automobile Marketersrely on this type of segmentation to match up with customers.

Many companies even market similar products of different grades or different

accompanying services to different groups on the basis of product-benefit preference.

Factors used to segment industrial markets are grouped along different lines than those

used for consumer markets. Some are very different; some are similar. Industrial markets

are often divided on the basis of organizational variables, such as type of business,

company size, geographic location, or technological base. In other instances, they are

segmented along operational lines such as products made or sold, related processes used,

volume used, or end-user applications. In still other instances, differences in purchase

practices provide the segmentation base. These differences include centralized versus

decentralized purchasing; policy regarding number of vendors; buyer-seller relationships;

and similarity of quality, service, or availability needs. Although demographic,

geographic, and organizational differences enable marketers to narrow their

opportunities, they rarely provide enough specific information to make a decision on

dividing the market. Psychographic data, operational lines, and, in particular, perceived

12

8/6/2019 2276. Segmentation of Marketing [Nokia]

13/71

8/6/2019 2276. Segmentation of Marketing [Nokia]

14/71

Considerations for Market Segmentation

To identify segments, marketers examine consumers' interests, tastes, preferences, and

socioeconomic characteristics in order to determine their patterns of consumption and

how they will respond to various marketing strategies. The primary information

marketers seek is why consumers purchase specific products or services but not others.

Catalog retailers and direct-marketing firms make up some of the key users of market

segmentation, although many other kinds of companies and organizations use this

technique.

To whom do you sell and how do you promote sales?To whom do you sell and how do you promote sales?

Market segmentation, however, works effectively only for certain kinds of products andMarket segmentation, however, works effectively only for certain kinds of products and

services.services.

First, to determine whether to segment a market, marketers must find out if the marketFirst, to determine whether to segment a market, marketers must find out if the market

can be identified and measured, which entails determining which consumers belong tocan be identified and measured, which entails determining which consumers belong to

specific market segments.specific market segments.

Second, marketers must determine if the segments are large enough to be profitable.Second, marketers must determine if the segments are large enough to be profitable.

While marketers can easily divide the total market into smaller groups, these groupsWhile marketers can easily divide the total market into smaller groups, these groups

might be so small that they do not justify the expenses associated with marketmight be so small that they do not justify the expenses associated with market

segmentation.segmentation.

Third, marketers must be able to reach the segments through their advertising. If theThird, marketers must be able to reach the segments through their advertising. If the

members of a particular segment do not share interest in a common magazine ormembers of a particular segment do not share interest in a common magazine or

television show, for example, then marketers have no way of reaching the segment and sotelevision show, for example, then marketers have no way of reaching the segment and so

the segment is superfluous.the segment is superfluous.

Fourth, marketers must gauge the responsiveness of the segments and find out if aFourth, marketers must gauge the responsiveness of the segments and find out if a

proposed segment would likely respond to a marketing campaign. If it is not probableproposed segment would likely respond to a marketing campaign. If it is not probable

that a segment will react to a promotion, then the segment is not useful.that a segment will react to a promotion, then the segment is not useful.

14

8/6/2019 2276. Segmentation of Marketing [Nokia]

15/71

Fifth, marketers must determine if the segments will change in the near future. Since itFifth, marketers must determine if the segments will change in the near future. Since it

takes time to prepare a marketing strategy for specific segment and since it takes time fortakes time to prepare a marketing strategy for specific segment and since it takes time for

market segmentation to be profitable, creating segments where consumer needs andmarket segmentation to be profitable, creating segments where consumer needs and

wants are likely to change would not be productive.wants are likely to change would not be productive.

Representation of Market SegmentRepresentation of Market Segment

Market DemandMarket Demand

Aggregate of the demands of all potential customers (marketparticipants) for a specific

product over a specific period in a specific market.

Market segmentMarket segment

Identifiable group of individuals, families, firms, or organizations, sharing one or more

characteristics orneeds in an otherwise homogenous market. Market segments generally

respond in a predictable manner to a marketing orpromotion offer.

1.1. Set of potential customers:Set of potential customers:

Who have similar needsWho have similar needs

Who reference each other when buyingWho reference each other when buying

2.2. Are alike in the way they:Are alike in the way they:

Perceive valuePerceive value

View products and servicesView products and services

Purchase products and servicesPurchase products and services

Why Define A Market Segment?Why Define A Market Segment?

Easier to understand customer needsEasier to understand customer needs

15

8/6/2019 2276. Segmentation of Marketing [Nokia]

16/71

Focus whole solution to a narrower set of customer needsFocus whole solution to a narrower set of customer needs

Easier to become a leader in a smaller market (Big fish in small pond)Easier to become a leader in a smaller market (Big fish in small pond)

More effective use of marketing dollarsMore effective use of marketing dollars

Generally more profitableGenerally more profitable

Why Market Segmentation?

A major key to a companys success is its ability to select the most

appropriate market segmentation because a company cannot target whole market. There

are general guidelines for selection of target markets:

Target market should be compatible with the organization goals and

image.

The target market should match the marketing opportunity with the

companys resources.

An organization should consciously seek markets that will generate a

sufficient sales volume at a low cost to result in a profit.

A company should select a market wherein the number of competitors and

their size are small.

The total markets for many products is to varied-too heterogeneous. This

variation Is due to the differences in buying habits ways to use the products

motives for buying etc. Market segmentation takes these difficulties into account.

16

8/6/2019 2276. Segmentation of Marketing [Nokia]

17/71

Benefits of Market Segmentation

Better marketing job and efficient use of marketing resources.

Small firm with limited resources can compete effectively in one or two marketsegments.

A company can design products that really match the market demands.

Advertising media can be used more effectively toward each segment of market.

Drawbacks of Market Segmentation upto some extent

It is an expensive proposition in both the production and marketing ofproducts.

Segmentation increases marketing expenses in several ways i.e. Inventory cost

goes up, advertising cost goes up, administrative expense goes up.

Segmentation BasisSegmentation Basis

The market can be divided into segments by using four "segmentation basis":

Psychographic, behavioristic, geographic, and demographic basis.

The basic criteria for segmenting a market is are customer needs. To find the needs of theThe basic criteria for segmenting a market is are customer needs. To find the needs of the

customers in the market it is important to undergo a market research.customers in the market it is important to undergo a market research.

Psychographic and behavioristic bases are used to determine preferences and demand for

a product and advertising content, while geographic and demographic criteria are used to

determine product design and regional focus.

17

8/6/2019 2276. Segmentation of Marketing [Nokia]

18/71

Different market variablesDifferent market variables

Geographic segmentationGeographic segmentation

Geographic basis focus on preferences contingent on regional factors, such as region

(e.g., North or South), county, population density, urban or rural location, and climate.

Collecting and analyzing information according to the physical location of the customer

or otherdata source.

Geographic segmentation is often used in marketing, since companies selling products

and services would like to know where their products are being sold in orderto increase

advertising and sales efforts there.

Geographic segmentation calls for dividing the market into different geographical units

such as nation, states, regions, countries, cities, or neighborhoods . The company can

operate in one or a few geographic areas, or operate in all but pay attention to local

variations .

Demographic SegmentationDemographic Segmentation

Market segmentation based on differences in demographic factors (which normally match

consumerwants and needs) of different groups ofconsumers. It is one of the five

common segmentation strategies, and aims to define specific niches that require custom-

tailoredpromotion. Demographics include personal characteristics such as gender, age,marital status, social attributes (such as ethnicity and religion), and income level.

In demographic segmentation , the market is divided into groups on the basis of variables

such as age , family life cycle , gender , income , occupation , education , religion , race ,

generation , nationality , and social class. Demographic variables are the most popular

18

8/6/2019 2276. Segmentation of Marketing [Nokia]

19/71

bases for distinguishing customer groups. One reason is that consumer wants,

preferences, and usage rates are often associated with demographic variables. Another is

that demographic variables are easier to measure.

Age and Life-Cycle Stage

Consumer wants and abilities change with age. Age and life cycle can be tricky variables.

For example, the Ford Motor Company designed its Mustang automobile to appeal to

young people who wanted an inexpensive sports car . But Ford found that many

mustangs were purchased by older buyers. It then realized that its target market was not

the chronologically young but the psychologically young.

Life Stage

Person in the same part of the life cycle may differ in their life stage. Life stage defines a

persons major concern, such as going through a divorce, going into a second marriage,

taking care of older parents, deciding to cohabit with another person, deciding to buy anew home, and so on.

Gender

Men and women tend to have different attitudinal and behavioral orientations, based

partly on genetic makeup and partly on socialization practices.

Gender differentiation has long been applied in clothing, hairstyling, cosmetics and

magazines. The automobiles industry is beginning to recognize gender segmentation,

since there are now more women car owners, some manufacturers are designing features

to appeal to women, although they stop short of advertising the cars as womens cars.

19

8/6/2019 2276. Segmentation of Marketing [Nokia]

20/71

Income

Income segmentation is long- standing practice in such products and services categoriesas automobiles, boats, clothing, cosmetics, and travel. However, income does not always

predict the best customers for a given product.

Generation

Many researchers are now turning to generation segmentation. Each generation is

profoundly influenced by the times in which it grows up- the music, movies, politics, and

defining events of that period. Demographers call these groups cohorts.

Social Class

Social class has a strong influence on preference in cars, clothing, home, furnishings,

leisure activities, reading habits, and retailers. Many companies design products and

services for specific social classes.

Psychographic SegmentationPsychographic Segmentation

The division of a heterogeneous market into relatively homogeneous groups on the basis

of theirattitudes, beliefs, opinions, personalities and lifestyles; sometimes called "State-

of-Mind" Segmentation.

Personality the distinctive character of an individual; used as a basis for the

psychographic segmentation of a market in which individuals of relatively similar

personality, with similarneeds orwants, are grouped into one segment.

In psychographic segmentation, buyers are divided into different groups on the basis of

lifestyle or personality or values. People within the same demographic group can exhibit

very different psychographic profiles.

20

8/6/2019 2276. Segmentation of Marketing [Nokia]

21/71

Lifestyle

People exhibit many more lifestyles than are suggested by the seven social classes.People differ in attitudes, interest, activities, and these affect the goods and services they

consume. Companies making cosmetics and furniture are always seeking opportunities in

lifestyles segmentation, but lifestyle segmentation does not always work.

Personality

Markers have used personality variables to segment markets. They endow their products

with a brand personality that corresponds to a target consumer personality. Thecompany utilizes product features, services, and image making to transmit the products

personality.

Values

Some markers segment by core values. Core values go much deeper than behavior or

attitude, and determine, at a basic level, peoples choices and desires over the long term.

Behavioral SegmentationSegmentation

Market segmentation based on differences in the consumptionbehaviorof different

groups of consumerstheir life-styles,patterns of buying and using, patterns of spending

money and time, etc. One of the five common segmentation strategies, its objective is to

define specific niches that require custom tailoredpromotion. In behavioral segmentation,

buyers are divided into groups on the basis of their knowledge of, attitude toward, use of,

or response to a product. Many marketers believe that behavioral variables-occasions,

benefits, user status, usage rate, loyalty status, buyer-readiness stage, and attitudeare

the best starting points for constructing market segments.

21

8/6/2019 2276. Segmentation of Marketing [Nokia]

22/71

Occasions

Buyers can be distinguished according to the occasions when they develop a need,purchase a product, or use a product. Occasions segmentation can help firms expand

product usage. For example in Pakistan tea is usually consumed at breakfast. A

company can consider occasions of critical life events or transitions-marriage,

childbirth, illness, relocation, career changeas giving rise to new needs.

Benefits

Buyers can be classified according to the benefits they seek, people vary considerably inthe benefits they seek from the same product.

1. Road Warriors: premium products and quality service. (16%)

2. Generation F: fast fuel, fast service, and fast food. (27%)

3. True Blues: branded products and reliable service. (16%)

4. Home bodies: convenience. (21%)

5. Price Shoppers: Low price. (20%)

User Status

Markets can be segmented into nonuser, ex-users, potential users, first time users, and

regular users of a product. Market-share leaders tend to focus on attracting potential users

because they have the most to gain. Smaller firms focus on trying to attract current users

away from the market leader

Usage Rate

22

8/6/2019 2276. Segmentation of Marketing [Nokia]

23/71

Markets can be segmented into light, medium, and heavy product users. Heavy users are

often a small percentage of the market but account for high percentage of total

consumption

Loyalty Status

Consumers have varying degrees of loyalty to specific brands, stores, and companies.

Buyers can be divided into four groups according to brand loyalty status:

1. Hard-core loyals: Consumers who are buy one brand all the time.

2. Split loyals: Consumers who are loyal to two or three brands.

3. Shifting loyals: Consumers who shift from one brand to another.

4. Switchers: Consumers who show no loyalty to any brand.

Buyer-readiness stage

A market consists of people in different stages of readiness to buy a product. Some are

unaware of the product, some are aware, some are informed, some are interested, some

desire the product, and some intend to buy. The relative numbers make a big difference in

designing the marketing program.

Attitude

Five attitude groups can be found in a market: enthusiastic, positive, indifferent, negative,

and hostile. Door-to-door workers in political campaign use the voters attitude to

determine how much time to spend with that voter. They thank to enthusiastic voters and

remind them to vote; they reinforce those who are positively disposed; they try to win the

votes of indifferent voters; they spend no time trying to change the attitudes of negative

and hostile voters.

Usage SegmentationUsage Segmentation

There are two ways of carrying out usage segmentation; firstly customers are split

according to their weight of use. - heavy users/buyers being more important targets than

23

8/6/2019 2276. Segmentation of Marketing [Nokia]

24/71

light users. This segmentation can be carried out directly on customer databases and can

be extremely powerful in focusing activity based on the value to the business, not just the

number of contacts.

Patterns of Market Segmentation

24

Segmentation Variables Data

Geographic

World region Asia

Country Pakistan

Cities All major cities of Pakistan

Density Urban

Climate Hot and Dry

Demographic

Age All ages

Gender Male, Female

Family size 1-2, 3-4, 5+

Family life cycle Young, Single; Young, Married, no children; Young,

Married with children; Older, Married with children; Older,

Married with no children under 18; Older, Single; Other

Income Rs.30,000+

Occupation From middle class to upper class

Education Schools, Colleges, Universities

Religion Major religion of Islam, Christianity and Hinduism and small

percentage of others

Race Asian

Nationality Pakistani

Psychographic

Social class Working class, Middle class, Upper class.

Lifestyle Actualizes, Fulfilled, Believers, Achievers, Strivers,

Experiences makers and Strugglers

Behavioral

Occasions Parties, Birthdays, Sports and Regular Occasions

Benefits Quality, Taste, Economy, Health

User status First time user Attitude towards product Positive

8/6/2019 2276. Segmentation of Marketing [Nokia]

25/71

Market segments can be build up in many ways, one way is to identify preference

segments. For example cookies buyers are asked how much they value sweetness and

saltiness in biscuits as two product attributes. Three different patterns can emerge.

1. Homogeneous Preferences: shows a market where all the consumers have

roughly the same preferences. The market shows no natural segments. We would

predict that existing brands would be similar and cluster around the middle of the

scale in both sweetness & saltiness.

2. Diffused Preferences: At the other extreme, consumer preferences maybe

scattered throughout the space, indicating that customers vary greatly in their

preferences. The first brand to enter the market is likely to position in the center to

appeal to the most people.

3. Clustered Preferences: The market might reveal distinct preference clusters,

called natural market segments. The first firm in this market has three options. It

might position in the center, hoping to appeal to all groups. It might position in

the largest market segment (concentrated marketing).It might develop several

brands, each positioned in a different segment. If the first firm developed only one

brand, competitors would enter and introduce brands in the other segments.

The Segmentation ProcessThe Segmentation Process

Once a company has gathered information from these segmentation bases, it must decide

how to divide the market, bearing in mind that market segmentation seeks to minimize

the differences within a segment and maximize the differences among segments.

Consequently, depending on the product or service to be marketed, simple divisions

along age, gender, or geographic lines alone may yield segments that are too vague to be

25

8/6/2019 2276. Segmentation of Marketing [Nokia]

26/71

of use. Instead, marketers may have to consider several characteristics or clusters of

characteristics in order to divide the market into useful segments.

For example, when considering beer consumption, marketers must look at both age and

gender: the majority of beer drinkers are both young and male.

To begin segmenting the market, marketing managers must select the

segmentation bases they will use to develop the segments, depending on the

products or services to be marketed. Marketers may select a few segmentation

bases they believe are the most relevant at the outset and develop market

segments using them. On the other hand, they may compile a large array of

information using all the segmentation bases and use this information to group

consumers in various segments.

Next, marketers conduct any primary market analysis they may need, by

preparing questionnaires and samples and by assessing the response to them.

Using this information, marketers try to determine the most fruitful segments

the ones with greatest similarities within them. Because this process can be labor-

intensive and require advanced knowledge of statistics, companies often rely on

outside firms or artificial intelligence technology to produce meaningful market

segments.

Once relevant, stable, reachable, profitable market segments are established,

marketers can target the segments they believe will offer the best opportunities for

growth given their products and resources and the ones they believe that

correspond to the products being marketed the best. Finally, marketers can

develop and launch advertising campaigns that appeal to the various segments.

Companies tend to choose the largest segments, although the segments with the most

consumers are not always the most profitable and usually have the most competition.

Consequently, marketers might benefit from considering targeting smaller segments or

segments ignored by competitors, such as low-income consumers, which is frequently

referred to as niche marketing.

26

8/6/2019 2276. Segmentation of Marketing [Nokia]

27/71

Method of SegmentationMethod of Segmentation

A company also may opt to target just one segment of the market, employing the

market segmentation method of concentration. After considering various segmentation

bases and conducting research, a company might find that its competitors are not reaching

specific segments and decide to target this segment or niche exclusively. A computer

maker, for instance, could concentrate solely on the home-user segment of the market and

ignore the needs of the other segments. To do so, the computermaker would have to offerproducts that meet home-user needs at prices these consumers could afford. Since

concentrated marketing costs less than differentiated marketing, it may appeal to small

businesses in particular.

After choosing a method of market segmentation, marketers must integrate the method

into an overall marketing strategy. The marketing strategy will try to make the target

product or service appeal to the target segment through an advertising campaign

developed based on segmentation information such as age, gender, or location. Marketers

also consider what a company's strategic position in a market ise.g., if it is a computer

supplier to home users or businessesand creates a marketing program that will help a

company achieves or maintain this position. If the segment is properly defined for a

specific product or service, then developing promotional strategies and reaching the

target segment should be relatively easy. The information used to help create the market

segments should help marketers choose among promotional techniques (e.g., direct

marketing, advertising, publicity, and sales promotion), pricing strategies, and

distribution strategies. This information also should help marketers choose among

various advertising media.

After collecting a large amount of information about their customers, marketers can plan

promotions and products that will appeal to various segments over a long time by

determining what products a segment wants in the future and offering them at the

appropriate time

27

8/6/2019 2276. Segmentation of Marketing [Nokia]

28/71

Target CostingTarget Costing

Is a disciplined process that uses data and information in a logical series of steps to

determine and achieve a target cost for the product. In addition, the price and cost are for

specified product functionality, which is determined from understanding the needs of the

customer and the willingness of the customer to pay for each function.

The Basic ProcessThe Basic Process: the basic stages in the Target-Costing process:

1. define the product

2. set the target

3. achieve the target

4. maintain competitive cost

The stages are market-driven:

Define the Product answers the fundamental questions of What are you selling?

To whom? What do they want it to do?

Set the Target addresses the issue of What will they pay for it? What should it

cost to produce?

Achieve the Target is concerned with How can we get there? Are we getting

there?

Maintain Competitive Cost deals with How can we stay ahead?

Entrepreneurial Strategy:Entrepreneurial Strategy:

Define market segment small enough to allow you to capture 25% to 30% shareDefine market segment small enough to allow you to capture 25% to 30% share

Be a Big fish in small pondBe a Big fish in small pond

Ideal: Be the only supplier in a very narrowly defined market.Ideal: Be the only supplier in a very narrowly defined market.

28

8/6/2019 2276. Segmentation of Marketing [Nokia]

29/71

Effective Segmentation

Not all segmentation is useful. For example, table salt buyers could be divided into blond

and brunette customers, but hair color is not relevant to the purchase of salt. Furthermore,

if all salt buyers buy the same amount of salt each month, believe all salt is the same, and

would pay only one price for salt, this market would be minimally segmentable from a

marketing point of view.

To be useful, market segment must be:

Measurable: The size, purchasing power, and characteristics of the segment can be

measured.

Substantial: The segments are large and profitable enough to serve. A segment should be

the largest possible homogeneous group worth going after with a tailored marketing

program. It would not pay, for example, for an automobile manufacturer to develop cars

for people who are under four feet tall.

Accessible: The segments can be effectively reached and served.

Differentiable: The segments are conceptually distinguishable and respond differently to

different marketing-mix elements and programs. If married and unmarried women

respond similarly to a sale on perfume, they do not constitute separate segments.

Actionable: Effective programs can be formulated for attracting and serving the

segments.

29

8/6/2019 2276. Segmentation of Marketing [Nokia]

30/71

Introduction

Introduction to Project

This Project deals with Various Market Segmentation done in Mobile Industries. This

Project mainly focuses on Various Market Segmentation done by Nokia Co. Ltd. in the

Market.

Nokia is a world leader in mobile communications, driving the growth and sustainability

of the broader mobility industry. Nokia connects people to each other and the information

that matters to them with easy-to-use and innovative products like mobile phones,

devices and solutions for imaging, games, media and businesses. Nokia provides

equipment, solutions and services for network operators and corporations.

Marketing is one of the most important functions in business. It is the discipline required

to understand customers' needs and the benefits they seek. Academics does not have one

commonly agreed upon definition. Even after a better part of a century the debate

continues. In a nutshell it consists of the social and managerial processes by which

products (goods or services) and value are exchanged in order to fulfill the needs and

wants of individuals or groups.Market segmentation is the process of identifying key

groups or segments within the general market that share specific characteristics and

consumer habits. Once the market is broken into segments, companies can develop

advertising programs for each segment, focus advertising on one or two segments or

niches, or develop new products to appeal to one or more of the segments. Companies

often favor this method of marketing to the one-size-fits-all mass marketing approach,

because it allows them to target specific groups that might not be reached by mass

marketing programs.

The market can be divided into segments by using four "segmentation basis":

Psychographic, behavioristic, geographic, and demographic basis.The basic criteria forThe basic criteria for

segmenting a market is are customer needs. To find the needs of the customers in thesegmenting a market is are customer needs. To find the needs of the customers in the

market it is important to undergo a market research.market it is important to undergo a market research.Psychographic and behavioristic

30

8/6/2019 2276. Segmentation of Marketing [Nokia]

31/71

bases are used to determine preferences and demand for a product and advertising

content, while geographic and demographic criteria are used to determine product design

and regional focus.

Review of Literature

This literature review will analyze the project on Market Segmentation of Nokia and on

past and current research that has been done which relates to the market segmentation.

This critical analysis of literature contains data about marketing and segmentation

strategies collected from various sources.

It is important to understand why people and market needs to be divided into different

segments. A segmented market is seen as an opportunity to effectively focus on particular

customers. This appeals to potential customers and also marketers, as they know that this

is what they will have to do.

This study also shows how Nokia, a mobile giant, segments its market and focuses its

products efficiently towards the customers of a particular segment. This gives a

competitive advantage to the company by serving its customers well.

Object ive of the Study

The objectives of the present study are:-

1) To know about Nokia Company.

2) To know about the strengths, weaknesses, opportunities and threats of Nokia.

3) To know about marketing.

4) To know about market segmentation.

5) To know the market segmentation used by Nokia.

31

8/6/2019 2276. Segmentation of Marketing [Nokia]

32/71

Methodology

Research always starts with a question or a problem. Its purpose is to question through

the application of the scientific method. It is a systematic and intensive study directed

towards a more complete knowledge of the subject studied. Marketing research is the

function which links the consumer, customer and public to the marketer through

information- information used to identify and define marketing opportunities and

problems generate, refine, and evaluate marketing actions, monitor marketing actions,

monitor marketing performance and improve understanding of market as a process.

There are two types of data collection method use in my project report.

Primary data

Secondary data.

For my project, I decided on primary data collection method by approaching customers

directly and through references to know their views about the company.

Secondary data collection method was used by referring to various websites, for

collecting information regarding project under study.

Limitations of Study

1 ) The study is based on secondary data, the information provided 2nd hand about Nokia.

2) The present study suffers from all the limitations of case study method.

32

8/6/2019 2276. Segmentation of Marketing [Nokia]

33/71

Introduction

The company I have chosen to analyse in my project is the mobile phone giant Nokia.

This project tells us briefly what Nokia actually is, its company structure and overall

view on the size and sales of the company & also the Various Market segmentation

Strategies followed by them.

Since January 2004, Nokia Group has consisted of four different business groups: Mobile

Phones, Multimedia, Enterprise Solutions and Networks. In addition, there are two

horizontal groups that support the mobile device business groups: Customer and Market

Operations and Technology Platforms. In the year 2004 Nokias net sales for mobile

phones were 18507 million euro, which went down 12% from 2003. Nokias marketareas were Europe/Africa/Middle East (55% of net sales), Asian Pacific and China (25%)

and Americas (20%). Nokias market share in Europe was 45.8% in 2003, in 2004 it was

34.8% and in the third quarter of 2005 it was 36%. The average number of personnel for

2004 was 53511. At the end of 2004, Nokia employed 55505 people worldwide. In 2004,

Nokias personnel increased by a total of 4146 employees. Nokias turnover for the third

quarter of 2005 was 8403 million euro from which mobile phones brought in 62%,

multimedia 17%, Enterprise solutions 2% and Networks 9%. The year 2004 was

demanding for Nokia. In response, the company set five top priorities in the areas of

customer relations, product offering, R&D efficiency, demand-supply management and

the companys ability to offer end-to-end solutions. Nokia is making good progress in

these areas, and is now better positioned to meet future challenges.

33

8/6/2019 2276. Segmentation of Marketing [Nokia]

34/71

Nokia Vision/Mission Statement

Our Vision

A world where everyone can be connected.

In 2015, 5 billion people always connected, and 100 fold more network traffic.

Its a world of experiences, shared experiences.

Our Promise

We help people feel close to what matters to them.

One of our basic needs as human beings is the need to communicate and share.

Our promise is to help fulfil this need, to help them feel close to what matters to them.

Our Approach

Consumer understanding drives us.

We observe first, then design. We act on our consumer insights.

We take a very human approach to technology

1. Simple

2. Reliable

3. Intuitive

4. Experiences to fall in love with.

Internet is our quest. Internet innovation, creativity, media and services will be available

anytime, anywhere.

34

8/6/2019 2276. Segmentation of Marketing [Nokia]

35/71

Nokia wants to bring the best of internet to mobile

.

Our Resolution-Grow, Transform, Build

Grow the number of people using nokia devices.

Transform the devices people use.

Build new businesses

Our business and peoples expectations for mobile devices and services are changing.

Nokias promise is to help people feel close to what matters to them.

About the Company

Nokia- Connecting People !

Nokia Corporation (NYSE: NOK) is one of the world's largest telecommunications

equipment manufacturers. With headquarters in Keilaniemi of Espoo, Finland, this

Finnish telecommunications company is best known today for its leading range of mobile

phones. Nokia also produces mobile phone infrastructure and other telecommunications

equipment for applications such as traditional voice telephony, ISDN, broadband access,

professional mobile radio, voice over IP, wireless LAN and a line of satellite receivers.

Nokia provides mobile communication equipment for every major market and protocol,

including GSM, CDMA, and WCDMA.

Nokia was established in 1865 as a wood-pulp mill by Fredrik Idestam on the banks of

Nokia rapids. Finnish Rubber Works established its factories in the beginning of 20th

century nearby and began using Nokia as its brand. Shortly after World War I Finnish

Rubber Works acquired Nokia wood mills as well as Finnish Cable Works, a producer of

35

8/6/2019 2276. Segmentation of Marketing [Nokia]

36/71

telephone and telegraph cables. All three companies were merged as Nokia Corporation

in 1967. The name Nokia originated from the river which flowed through the town of the

same name (Nokia).

In the 1970s Nokia became more involved in the telecommunications industry by

developing the Nokia DX 200, a digital switch for telephone exchanges. In the 1980s,

Nokia offered a series of personal computers called MikroMikko. However, these

operations were sold to International Computers, Ltd. (ICL), which was later merged

with Fujitsu-Siemens AG. Nokia also began developing mobile phones for the NMT

network; unfortunately, the company ran afoul of serious financial problems in the 1990s

and streamlined its manufacturing of mobile phones, mobile phone infrastructure, and

other telecommunications areas, divesting itself of other items, such as televisions andpersonal computers.

In 2004, Nokia resorted to similar streamlining practices with layoffs and organizational

restructuring, although on a significantly smaller scale. This, however, diminished

Nokia's public image in Finland, and produced a number of court cases along with, at

least, one television show critical of Nokia.

Recently, Nokia joined other mobile phone manufacturers to embrace TaiwaneseOriginal Device Manufacturers. Nokia signed a contract with BenQ, a Taiwanese

Original Device Manufacturer, to develop three high-end mobile phones, which are

scheduled to retail by the end of 2005.

36

8/6/2019 2276. Segmentation of Marketing [Nokia]

37/71

History of Nokia

Nokia's history started in year 1865, when engineer Fredrik Idestam established a wood-

pulp mill in Southern Finland and started manufacturing paper. Due to the European

industrialization and the growing consumption of paper and cardboard Nokia soon

became successful. In 1895 Fredrik Idestam handed over the reins of the company to his

son-in-law. Nokia was Actually founded in 1965 by Fredrik Idestam in Finland as a paper

manufacturing company. In 1920, Finnish Rubber Works became a part of the company,

and later on in 1922, Finnish Cable Works joined them. All the three companies were

merged in 1967 to form the Nokia Group. Nokia created the NMT mobile phone standard

in 1981 and launched the first NMT phone, Mobira Cityman, in 1987. The company

delivered the first GSM network to Radkilinia, a Finnish company in 1991, and in 1992,

Nokia 1011 - a precursor for all Nokias current GSM phones - was introduced. In the

1990s, Nokia provided GSM services to 90 operators across the world. Another

significant move of the company during this period was the divestment of its non-core

operations like IT. The company focused on two core businesses - mobile phones and

telecommunications networks. In the 1990s, Nokia provided GSM services to 90

operators across the world. Another significant move of the company during this period

was the divestment of its non-core operations like IT. The company focused on two corebusinesses - mobile phones and telecommunications networks. Nokia's history contains

many achievements that were the first of their kind in the world. Many milestones have

been experienced in the mobile phone business since the 80s. The success with the NMT

and GSM technologies and the products they spawned secured Nokia's position as the

world's leading telecommunications company. The list of Nokia's milestones provided a

good insight in the history of wireless communications. Nokia has been involved in

making the world's first NMT network and the world's first pocket-sized mobile phone.

The world's first device to use the Symbian OS was also produced by Nokia. Nokia was

able to offer advanced products from the beginning of the 90s. Early investments in R&D

were thus handsomely rewarded.

37

8/6/2019 2276. Segmentation of Marketing [Nokia]

38/71

Nokia ensured its continued growth by reforming its production in the middle of the 90s.

The new phone models and standardized technical solutions made it possible to produce

an increasingly extensive product range more effectively. The extensive range of mobile

phone models, covering all user groups, is one of the reasons why Nokia became the

market leader.

Company Profile

Nokias first century:1865-1967

The first Nokia century began with Fredrik Idestam's paper mill on the banks of the

Nokianvirta river. Between 1865 and 1967, the company would become a major

industrial force; but it took a merger with a cable company and a rubber firm to set the

new Nokia Corporation on the path to electronics

1865: The birth of Nokia

Fredrik Idestam establishes a paper mill at the Tammerkoski Rapids in south-western

Finland, where the Nokia story begins.

1898: Finnish Rubber Works founded

Eduard Poln founds Finnish Rubber Works, which will later become Nokia's rubber

business.

1912: Finnish Cable Works founded

Arvid Wickstrom starts Finnish Cable Works, the foundation of Nokia's cable and

electronics businesses.

1937: Verner Weckman, industry heavyweight

Former Olympic wrestlerVerner Weckman becomes President of Finnish Cable Works.

38

8/6/2019 2276. Segmentation of Marketing [Nokia]

39/71

1960: First electronics department

Cable Works establishes its first electronics department, selling and operating computers.

1962: First in-house electrical device

The Cable Works electronics department produces its first in-house electrical device - a

pulse analyzer for nuclear power plants.

1967: The merger

Nokia Ab, Finnish Rubber Works and Finnish Cable works formally merge to create

Nokia Corporation.

The move to mobile:1968-1991

The newly formed Nokia Corporation was ideally positioned for a pioneering role in the

early evolution of mobile communications. As European telecommunications marketswere deregulated and mobile networks became global, Nokia led the way with some

iconic products...

1979: Mobira Oy, early phone maker

Radio telephone company Mobira Oy begins life as a joint venture between Nokia and

leading Finnish television maker Salora.

1981: The mobile era begins

39

8/6/2019 2276. Segmentation of Marketing [Nokia]

40/71

Nordic Mobile Telephone (NMT), the first international mobile phone network, is built.

1982: Nokia makes its first digital telephone switch

The Nokia DX200, the companys first digital telephone switch, goes into operation.

1984: Mobira Talkman launched

Nokia launches the Mobira Talkman portable phone.

1987: Mobira Cityman birth of a classic

Nokia launches the Mobira Cityman, the first handheld NMT phone.

1991: GSM a new mobile standard opens up

Nokia equipment is used to make the worlds first GSM call.

Mobile revolution:1992-1999

In 1992, Nokia decided to focus on its telecommunications business. This was probably

the most important strategic decision in its history.

As adoption of the GSM standard grew, new CEO Jorma Ollila put Nokia at the head of

the mobile telephone industrys global boom and made it the world leader before the

end of the decade...

1992: Jorma Ollila becomes President and CEO

Jorma Ollila becomes President and CEO of Nokia, focusing the company on

telecommunications.

1992: Nokias first GSM handset

40

8/6/2019 2276. Segmentation of Marketing [Nokia]

41/71

Nokia launches its first GSM handset, the Nokia 1011.

1994: Nokia Tune is launched

Nokia launches the 2100, the first phone to feature the Nokia Tune.

1994: Worlds first satellite call

The worlds first satellite call is made, using a Nokia GSM handset.

1997: Snake a classic mobile game

The Nokia 6110 is the first phone to featureNokias Snake game.

1998: Nokia leads the world

Nokia becomes the world leader in mobile phones.

1999: The Internet goes mobile

Nokia launches the world's first WAP handset, the Nokia 7110.

Nokia now:2000-today

Nokias story continues with 3G, mobile multiplayer gaming, multimedia devices and a

look to the future...

2002: First 3G phone

Nokia launches its first 3G phone, the Nokia 6650.

2003: Nokia launches the N-Gage

Mobile gaming goes multiplayer with the N-Gage.

41

8/6/2019 2276. Segmentation of Marketing [Nokia]

42/71

2005: The Nokia Nseries is born

Nokia introduces the next generation of multimedia devices, the Nokia Nseries.

2005: The billionth Nokia phone is sold

Nokia sells its billionth phone a Nokia 1100 in Nigeria. Global mobile phone

subscriptions pass 2 billion.

2006: A new President and CEO Nokia today

Olli-Pekka Kallasvuo becomes Nokias President and CEO; Jorma Ollila becomes

Chairman of Nokias board. Nokia and Siemens announce plans for Nokia Siemens

Networks.

2007

Nokia recognized as 5th most valued brand in the world. Nokia Siemens Networks

commences operations. Nokia launches Ovi, its new internet services brand.

2008

Nokia's three mobile device business groups and the supporting horizontal groups are

replaced by an integrated business segment, Devices & Services.

42

8/6/2019 2276. Segmentation of Marketing [Nokia]

43/71

SWOT Analysis

SWOT Analysis, is a Strategic planning tool used to evaluate the Strengths, Weaknesses,

Opportunities, and Threats involved in a Project or in a Business venture. It involves

specifying the objective of the business venture or project and identifying the internal and

external factors that are favorable and unfavorable to achieving that objective.

SWOT Analysis of Nokia

Modern SWOT Analysis

A SWOT analysis conducts an external and internal scan of Nokia's business

environment, it is an important part of the strategic planning process. Environmental

factors internal to the firm usually can be classified as strengths (S), or weaknesses (W),

and those external to the firm can be classified as opportunities (O) or threats (T). Such

an analysis of the strategic environment is referred to as a SWOT analysis.

The SWOT analysis provides information that is helpful in matching the firm's resources

and capabilities to the competitive environment in which it operates. As such, it is

instrumental in strategy formulation and selection.

Strengths

Is a dominant player in the smart phone market via its majority ownership of

Symbian and its proprietary Series 60 user interface which are projected to

represent majority of the 100M smartphones sold in the next 4 years.

33% market share still the largest cell phone vendor by far, with double the

market share of nearest competitr

Size should enable Nokia to amortize R&D costs and to get cost advantages

Brand position: probably one of the top 20 brands in the world

43

8/6/2019 2276. Segmentation of Marketing [Nokia]

44/71

Weaknesses

The N-Gage is considered a flop

Being the market leader and its increase role in Symbian is giving Nokia a bad

image, much like Microsoft in the PC industry.

Slow to adopt new ways of thinking: a good example are clamshell phones which

are preferred by many customers. Nokia was reluctant to produce a clamshell

until this year, when it launched its first model.

Opportuntiies

Increase their presence in the CDMA market, which they are just entering, as

well as 3G and Edge

New growth markets where cell phone adoption still has room to go, including

India and other countries.

Leverage its infrastructure business to get preference and a stronger position with

carriers

Threats

Late in the game in 3G creates a risk to be displaced by leaders like Motorola,

LG, NEC and others.

Asian OEMs who are entering the market very aggressively (TCL, nGo Bird)

ODMs (HTC and others) enabling carriers to leverage their customer power

bypassing the handset vendor. Operators want to lessen their dependency on

handset vendors and the dominance of Nokia. Orange, O2, and many other

operators globally are selling their own brand of phones.

44

8/6/2019 2276. Segmentation of Marketing [Nokia]

45/71

Production Units

Networks technology

China

Finland

Germany

India

Mobile devices and technology

Brazil

China

Finland

Great Britain

Hungary

India

Mexico

Romania

South Korea

45

8/6/2019 2276. Segmentation of Marketing [Nokia]

46/71

Market Segmentation for Nokia

The decibel levels in the cellular market are increasing with service providers stepping on

the gas. Not to be left behind, handset manufacturers are using precise segmentation to

carve up their share. Divide and rule seems to be working!

According to a report published in May 2001, the all-India cellular subscriber figures

stand at 38,71,514. With aggressive marketing by service providers, this figure is

expected to increase at a very rapid rate. If current decibel levels in the market are

anything to go by, these expectations are well on the way to being met. However, amidst

this entire melee one cannot ignore the efforts of the handset manufacturers. Both service

providers and handset manufacturers have been complementing each other well with each

fuelling the demand for the other.

Industry observers attribute the success of handset manufacturers to shrewd market

segmentation. The big three of the mobile handset market - Nokia, Ericsson and

Motorola, have studied the market and segmented it precisely.

Segmentation of Nokia

Connecting people!

Nokia, arguably the biggest player in the world, has divided the market into four

segments:

Hi-fliers: The biggest segment as far as Nokia is concerned consists of 'Hi-Fliers',

corporate executives who use a mobile phone to increase productivity at work.

Aged between 25-45, the segment looks for data transmission and other business-

46

8/6/2019 2276. Segmentation of Marketing [Nokia]

47/71

related features. In most cases, the company sponsors the handset, hence price is

not a major consideration.

Trendsetters: In any technology adoption cycle, the first segment to adopt an

emerging technology is dubbed as 'the early adopters'. For Nokia, these early

adopters are 'Trendsetters' who are most receptive to advanced models. This was

the segment at which WAP-enabled models were aimed.

Social contact: The third segment for Nokia is the upwardly mobile, socially-

conscious segment that uses a mobile to stay in touch. Today's youth and affluent

housewives constitute two major chunks of the segment.

Assured: The fourth and last segment as defined by Nokia comprises of CEOs,

high-profile celebrities, industrialists and other high "net worth" individuals. The

fact that the segment cannot do without a mobile phone makes it the 'assured'

segment.

47

8/6/2019 2276. Segmentation of Marketing [Nokia]

48/71

Geographic

World region Asia

Country India

Cities Reach out maximum places

Demographic

Age All age group

Gender Male, Female

Income All income groups

Occupation Every sector

Religion Irrespective of religion

Psychographic

Social class All class of people

Lifestyles Urban, rural, and even far villages

Behavioural

Benefits Quality

Loyalty status Strong

Nokiamobile phones by Series

Nokia 1000 series

48

8/6/2019 2276. Segmentation of Marketing [Nokia]

49/71

1011 1100/1101 1110/1110i 1112 1200 1208 1600 1610 1650

Nokia 2000 series

2110i 2115i 2310 2600 2600 classic 2610 2630 2650 2651 2700 classic 2730

classic 2760

Nokia 3000 series

3100/3100b/3105 3110 3110 classic 3120 3120 classic 3155 3200/3200b/3205

3210 3220 3230 3250 3310 3315 3330 3410 3500 classic 3510/3590/3595

3510i 3600/3620/3650/3660 3600 slide 3720 classic

Nokia 5000 series

5070 5100 5110 5130 Xpress Music 5200 5210 5220 Xpress Music 5230/5235

5300 5310 Xpress Music 5320 5330 Mobile TV Edition 5500 Sport 5510 5530

5610 5700 5730 5800

Nokia 6000 series

6010 6020/6021 6030 6070 6085 6100 6101 6103 6110/6120 6110

Navigator 6111 6120/6121/6124 classic 6131/6133 6136 6151 6170 6210 6210

Navigator 6220 classic 6230 6233 6255i 6260 Slide 6265 6270 6275i

6280/6288 6290 6300 6300i 6301 6303 classic 6310i 6315i 6500 classic 6500

slide 6555 6600 6600 fold 6600 slide 6610i 6620 6630 6650 6650 fold

6670 6680 6681/6682 6700 classic 6710 Navigator 6720 classic 6730 6800

6810 6820 6822

Nokia 7000 series

7110 7160 7210 7250 7280 7360 7380 7390 7500 Prism 7600 7610 7650

7700 7710 7900 Prism

49